Introduction to 401(k) Retirement Contributions on Pay Stubs

401(k) Retirement Contributions on Pay Stubs are one of the first lines savvy employees review every payday. These entries show how much you’re investing for retirement each period, how your employer is contributing, and how those amounts affect your take-home pay. Understanding this section helps you verify payroll accuracy, stay within annual limits, and make smarter, tax-efficient decisions about your financial future.

In this guide, you’ll learn where 401(k) items appear, the difference between Traditional and Roth contributions, 2025 contribution limits, how employer matches are shown, and how to troubleshoot common mistakes. Where helpful, we’ll use simple, realistic examples you can mirror on a regular pay stub or create with our quick pay stub generator.

Where 401(k) Items Appear on a Pay Stub

Most pay stubs group retirement items among deductions and benefits, with a column for the current pay period and another for year-to-date (YTD) totals. Look for labels such as “401(k),” “Retirement Plan,” “401K-Roth,” “401K-Pretax,” or the plan provider’s name.

• Employee 401(k) deduction (current/YTD): Your contribution this period and the cumulative total for the year.
• Employer match (current/YTD): The company’s contribution. This is not taken from your pay; it’s an added benefit shown for transparency.
• Traditional vs. Roth indicator: Many stubs split contributions into distinct lines (e.g., “401K-Pre” and “401K-Roth”).
• Taxable wages after pretax deductions: A wages line reflecting reductions from pretax items (including Traditional 401(k)).

Traditional vs. Roth 401(k): What Your Stub Signals

Understanding the “type” of contribution is crucial because it affects taxes now or later.

Traditional 401(k) (Pretax)

• Contributions reduce your current taxable wages, lowering income taxes today.
• Growth is tax-deferred; withdrawals in retirement are taxed as ordinary income.
• On your stub, you’ll often see a lower “taxable wages” figure than your gross pay when Traditional contributions are present.

Roth 401(k) (After-Tax)

• Contributions do not reduce current taxable wages; you pay income tax now.
• Qualified withdrawals in retirement are tax-free (contributions and growth).
• On your stub, Roth lines appear as after-tax deductions and do not reduce the “taxable wages” line for the period.

Many plans allow splitting contributions between Traditional and Roth. Your pay stub should list each type separately with its own current and YTD totals.

401(k) Contribution Limits for 2025

Annual caps help you plan contributions throughout the year and avoid excesses. For 2025:

• Employee contribution limit: $23,000 (Traditional + Roth combined)
• Catch-up contribution (age 50+): Additional $7,500
• Total limit including employer contributions: $69,000 (or $76,500 with catch-up)

Your YTD lines are the best way to track progress against these limits. If you increase your percentage mid-year, verify that your YTD totals still pace toward your target without surpassing the cap.

Employer Match: How It’s Calculated and Displayed

Employer matching contributions supercharge your savings. Policies vary—common formulas include 50% match on the first 6% you contribute, or a dollar-for-dollar match up to a set percentage. On most stubs the match appears under “Company 401(k), Employer Match,” or similar, with current and YTD totals.

Example: You earn $4,000 per month and contribute 5% ($200). Your employer matches 3% ($120). Your stub shows:

• 401(k) Employee Contribution (Current): $200 | YTD: adds each month
• 401(k) Employer Match (Current): $120 | YTD: adds each month
• Taxable Wages (Current): $3,800 if Traditional; still $4,000 if Roth

Remember: employer matches do not reduce your current taxable wages; they are additional compensation paid into your retirement account.

Reading the Numbers: A Simple Walk-Through

Consider a biweekly employee earning $2,000 gross per period who contributes 6% to a Traditional 401(k) with a 3% employer match.

• Employee 401(k) contribution: 6% × $2,000 = $120 (Current); YTD accumulates each paycheck.
• Employer match: 3% × $2,000 = $60 (Current); YTD accumulates each paycheck.
• Taxable wages after pretax: $2,000 − $120 = $1,880 (before other pretax items).
• Net pay impact: Your take-home is lower by your contribution (and other deductions), not by the employer match.

Switching the same 6% to Roth would keep taxable wages at $2,000, but still show a $120 after-tax 401(k) deduction line; the match remains $60 either way.

YTD Tracking and Mid-Year Adjustments

Your year-to-date totals give a running view of how close you are to the annual cap and how much your employer has added so far. If a raise or bonus bumps your income, consider adjusting your deferral percentage to stay on pace. Conversely, if you are nearing the limit in Q4, you might reduce the percent to avoid over-contributing.

Use a saved PDF of each regular pay stub to compare YTD progress month by month and document any changes you make.

Taxes: What Changes on Your Stub (and What Doesn’t)

• Traditional 401(k): Lowers current taxable wages; federal (and usually state) income tax withholding is calculated on the reduced amount.
• Roth 401(k): No reduction to current taxable wages; withholding is based on full wages.
• FICA (Social Security & Medicare): Generally not reduced by 401(k) contributions; FICA is based on gross wages for the period.

This is why your federal income tax line may change when you alter a Traditional contribution, while your FICA lines remain largely unaffected.

Common Pay Stub Issues and How to Fix Them

• Wrong percentage applied: Your deduction doesn’t match your elected rate. Verify your onboarding/election form and request a correction.
• Employer match missing: Ensure you meet eligibility and vesting rules; if you do, ask payroll to investigate.
• Type mislabeled: Traditional vs. Roth lines reversed can affect taxes. Flag immediately for correction.
• YTD totals off: Recalculate from prior stubs; if your math differs, share copies with HR/payroll.

Document any discrepancies with screenshots or PDFs of the affected stubs. Keeping a consistent archive is invaluable during corrections.

Choosing Your Mix: Practical Strategy Tips

• Start with the match: Contribute at least enough to capture the full employer match—leaving match money on the table is costly.
• Tax today vs. tax tomorrow: Favor Traditional if you need the immediate tax break; consider Roth if you expect higher tax rates later.
• Automate increases: Small, scheduled boosts (e.g., +1% each quarter) build momentum without a big hit to take-home pay.
• Use YTD “milestones”: Review quarterly to confirm you’re pacing toward your target but not exceeding IRS caps.

Self-Employed or Running Payroll? Make It Easy

If you’re self-employed, a contractor paying yourself via payroll, or managing a small team, calculating and displaying retirement deductions correctly can be tricky. A streamlined tool like the pay stub generator inserts the right lines (Traditional vs. Roth), keeps current/YTD totals straight, and produces professional documentation you can share with banks or landlords.

Quick Reference Table

Conclusion and Next Steps

Once you know how to read 401(k) Retirement Contributions on Pay Stubs, you can confirm that your elections are applied correctly, your employer match is flowing, and your YTD totals align with 2025 limits. Review each stub promptly, keep a clear archive of your regular pay stubs, and adjust contributions as your goals evolve. When you need polished, consistent documentation—or you’re setting up payroll for the first time—use the pay stub generator to create accurate stubs in minutes.